Richard Bergfors: Living Life to the Max

 
Max Hamburger Restaurants was founded in the north of Sweden by entrepreneur Curt Bergfors back in 1968. Today, Max is the second largest hamburger chain in Sweden, next after McDonald’s. What is even more important, it is the fastest growing chain, percentage wise, and the most profitable one. Until now, growth has been entirely within Sweden and all 54 units are fully owned and operated by the family company. The Management recently announced plans for international expansion. Interview with Richard Bergfors, President of Max, by Sofia Selberg.
 

 
How would you explain the tremendous success that Max has experienced in the Swedish market in competition with the global hamburger chains?
 
Richard Bergfors: I think there is a combination of reasons to explain our success. First of all, high product quality and taste are the features that we emphasize. We use the best raw materials, all carefully selected and thoroughly tested and we cook meals to order. Surveys show that our guest satisfaction is higher than our competitors’. We were very early in adapting the health trend. Our management team went to California for strategic planning and inspiration in 2000 and the lasting impressions as we returned home were freshness, local produce and health. This inspired us to develop our healthy assortment – Delifresh which became an immediate success. The launch of Delifresh helped Max into the pos ition of having a healthier profile than the other hamburger chains. We had many other successful product launches during the last few years, for example the Frisco bread and the GI-bread (glycemic index). One other strength is low staff turnover. We have a very positive company culture and many of our staff members have been with us for a long time. Restaurant managers can apply for Max partnership after 1-2 years. If they are accepted, we make an individual deal that can reward them with up to 15-20% of the profit of ‘their’ restaurant. This is a win-win situation which I am sure has lead to higher motivation and loyalty to the company. We have also developed a new kitchen/production line in order to increase capacity and cut lines which is positive both image wise and cost wise. We have turned the entire kitchen and process around. We have new machines and equipment and the work process is now completely different and more automatized. I believe that we are more productive than our competitors. To increase efficiency even more, we are testing an automatic order taking machine. A screen and buttons take you through the ordering process. You pay with a credit card and pick up your order at the counter. No need to handle cash, no need to wait in line. The test has turned very positive. In one of the test units, 40% of the lunch rush hour guests go directly to the machine. If the test continues to work well, the machine will probably rolled out in all restaurants within the 12 months.
 
What are Max’ domestic expansion strategies and goals within the five years?
 
Bergfors: The expansion plan in Sweden continue to grow by own power. Until end of 2007, we plan to open approximately one restaurant per month. Our goal double the number of restaurants in Sweden in the next four years which means that we would pass 100 units in 2011. Franchising is not a strategic option domestically. We want to keep control the brand and we have the financial resources to expand by ourselves. No without an exception, though. In Arlanda Airport, Stockholm, HMSHost is contracted to be the first and only Max franchisee in Sweden. The first unit will open in inal 4, Arlanda Airport, during the quarter of 2007.
 
How about Max’ international expansion strategies and goals within the next five years?
 
Bergfors: We have made the strategic decision to cross borders with the Max concept. There is still growth potential in Sweden but in a few years time the market will most likely begin to be saturated. Our goal is to open our first units outside of Sweden in 2008. We plan to enter three new markets and we will open 20 restaurants in each one of them within 3-4 years. In international expansion we will most likely go for franchising or partly franchising, partly own expansion. There are a number of advantages with franchising: spreading of risk, enabling faster expansion, limiting own financial investments, providing local competency and network.
 

 
| 15 October 2007 | Sofia Selberg |